Trump had been widely expected to nominate Powell to lead the US central bank in favour of retaining current chair Janet Yellen for a second term.

Powell, 64, is a Republican and a multi-millionaire, thanks to his career in investment banking and private equity. He has been a governor at the Fed since he was nominated by President Barack Obama in 2012.

"He's strong, he's committed, he's smart," Trump said in the White House Rose Garden on 2 November. "I am confident that with Jay as a wise steward of the Federal Reserve, it will have the leadership it needs in the years to come."

Analysts described Powell as a centrist figure at the Fed who is likely to persist with the central bank's current policy of gradually increasing interest rates.

"Powell rarely deviated from Yellen's vote and differs most clearly when it comes to regulation – he supports deregulation," trading firm IG said in a note.

Powell is known to be largely in favour of the sweeping Dodd-Frank reforms that were instituted to make US banks healthier following the 2008 financial crisis, even though Trump has pledged to undo many provisions of the seven-year-old regulatory law.

"In the years since the global financial crisis ended, our economy has made substantial progress toward full recovery," Powell said on 2 November.

"I will continue to work with my colleagues to ensure that the Federal Reserve remains vigilant and prepared to respond to changes in markets and evolving risks."

Yellen said: "Jay's long and distinguished career has been marked by dedicated public service and seriousness of purpose.

"I am confident in his deep commitment to carrying out the vital public mission of the Federal Reserve."